Real estate market analysis

As a real estate investor, one of the biggest mistakes you can make is not performing a solid market analysis.

If you don’t know what you’re talking about, how do you expect any partner to take you seriously? You have to know the market like the back of your hand.

Now, if you’re just starting off in the game, you need to know what points to look out for — and how to find them.

Real Estate Market Analysis 101

When analyzing your market, there are a few key areas that should be at the top of your list. And the data associated with them will make or break your deal.

Job Growth

  • How many jobs are being created in that area?
  • What is the total percentage increase or decrease over the past year?
  • Is the city known for high-paying job opportunities?

Rent

  • What is the average rent right now?
  • Is there an upwards or downwards trend?
  • How much are local tenants willing to pay for a premium apartment?

NOI (Net Operating Income)

  • How profitable would this property be?
  • What can I expect to pay for this piece of real estate?
  • How much debt would a bank give me for it?

Migration Trends

  • Are massive amounts of people moving here — or away from the area?
  • Is the property in a top-trending region?
  • What factors are behind the migration trend?

Neighborhood & Surroundings

  • Is the property in a good neighborhood?
  • What do the surrounding areas look like?
  • How does the neighborhood compare to others in the same city?

Where can you get this information?

After you know what questions to ask, continue by collecting the specific numbers to back up your claims.

While you can easily get all of these stats from one source or another, I recommend pulling data from multiple sources. That way, you’ll avoid any kind of bias in the process.

Here are just a few sources to help you start:

Now, to learn everything you need to know about finding, buying, and funding a great deal, watch my free real estate investing training.

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